Japanese Hydrogen Industry

Mr ODENWALDER (Little Para) (14:34): My question is to the Minister for Mineral Resources and Energy. Can the minister inform the house about the lessons from his recent trip to Japan, particularly in regard to hydrogen and its intended use as a future fuel source across industry and government?

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:35): Arigato—thank you very much.

The Hon. J.J. Snelling: You have to speak English in the chamber; it's a standing order.

The Hon. A. KOUTSANTONIS: No, Mr Mario Feleppa breached that standing order when he did his maiden speech. He spoke in Italian and the house deemed it appropriate.

The SPEAKER: I'm not sure that it did.

The Hon. A. KOUTSANTONIS: Well, you would have been there, sir; it was in the 1980s. Last month, I spent four days in Japan meeting with large companies and Japanese government officials to determine what role South Australia can play in their country's burgeoning hydrogen industry. I have to say that Japan's commitment and dedication to using this clean, low density gas for commercial, household and vehicle use were nothing short of impressive.

As a country, Japan is committed to doing all it can to lower emissions and has ambitiously declared the 2020 Olympic and Paralympic Games, to be held in Tokyo, the hydrogen games. Some of the companies we met, including Kawasaki Heavy Industries, Kansai and Chiyado, are at advanced stages of using various methods to both extract hydrogen from other substances and also transport the gas. They can store and use the gas as a clean and pure fuel source with no need for carbon capture storage mechanisms.

We also visited the Toyota factory where they manufacture the hydrogen fuel cell vehicle, known as the Mirai, which is already exported to the United States. This car has a hydrogen fuel cell and runs on pure hydrogen that can be refuelled at dozens of hydrogen refuelling stations across Japan. The only by-products from this vehicle, of course, are oxygen and water.

Japan is acutely aware that South Australia has an abundance of renewable energy—namely, solar and wind—that is low cost, which they find very appealing. They are encouraged by the capacity we have to generate green hydrogen, meaning using renewable energy to produce hydrogen via electrolysis with no carbon component. Currently, hydrogen is produced mainly using gas. The underlying challenge for all of the entities is how to transport this low-density gas safely and effectively.

What we have learned from government agencies and private companies is that we firmly believe optionality is key to the security of supply; moreover, investments that are environmentally beneficial are given favourable consideration from financiers. Private enterprise, in conjunction with the Japanese government, is spending billions of dollars on the import/export aspects of this project, especially in research and development. They are also dedicated in their in-principle support of seeing the importation of hydrogen to Japan, which we will be considering in our hydrogen road map for South Australia, which is currently underway.

We have elected to align our hydrogen strategy time lines with those outlined by representatives of Japan's strategic innovation promotion program and that of South Korea and China. The groups we have spoken to already indicate that they are keen to see the results of our work and to continue the dialogue with the state government, which is extremely encouraging. I look forward to updating the parliament on this opportunity, which allows us to use our abundant renewable energy that otherwise may be spilled for the manufacture and storage of hydrogen, either through other entities, through a carrier, then for export and, of course, encouraging our own hydrogen industry here.

We have the know-how. We have existing companies in place that are already exporting LNG. They are very similar types of products. If we can crack the code about how best to transport this fuel, it could create a new export market for Australia to some of our largest trading partners.